Nicholas Jones

Nicholas Jones inquired about how CoStar Group is leveraging AI to enhance its competitive moats and build stronger datasets for CoStar Suite, and expressed concern about the potential for AI-driven solutions from the legal sector to rapidly replicate similar datasets.

Answer

CoStar Group CEO Andy Florance explained that AI accelerates the creation of new proprietary datasets, citing the abstraction of confidential corporate leases in weeks rather than years at significantly lower cost. He stressed that AI cannot create data from nothing, and CoStar's massive volume of proprietary, authenticated data (e.g., from hotels, financial institutions, corporations, brokers) provides a significant competitive advantage that is not accessible to general LLM crawlers, making replication extremely difficult.

Nicholas Jones inquired about how CoStar Group is using AI to enhance its CoStar Suite moats and build stronger datasets, and the company's confidence that external AI-driven solutions cannot rapidly replicate its proprietary datasets.

Answer

CoStar Group CEO Andy Florance explained that AI accelerates the creation of new proprietary datasets, citing the example of abstracting corporate leases in weeks at low cost, a task that previously took years and hundreds of people. He stressed that AI cannot create data from nothing and that CoStar's massive volume of proprietary, authenticated, and non-public real estate data (e.g., from hotels, financial institutions, corporations, brokers, home builders, apartment managers) provides a significant competitive advantage that external AI crawlers cannot access or replicate.

Nicholas Jones from Citizens JMP asked about early customer conversations and traction for the new AgenTik AI products, and in a follow-up, asked what lessons management learned from recent stock volatility.

Answer

Co-Founder & CEO Or Offer identified the GenAI intelligence products as the fastest-growing in the portfolio, with strong demand and a robust pipeline. Regarding stock volatility, Offer stated the key lesson was the need for better communication, while CFO Jason Schwartz added that the quarter's detailed shareholder letter was a step toward providing more insight.

Luke Meindl, on behalf of Nicholas Jones, asked about the potential for further cost savings, particularly if the macroeconomic environment worsens, given the significant progress already made on improving the cost structure.

Answer

Executive Selim Freiha confirmed that Opendoor remains focused on optimizing its cost structure for durable savings beyond the 33% year-over-year fixed cost reduction achieved in Q1. He stated that the business has been rightsized for a slower market and that while future reductions may not be of the same magnitude, they continue to see efficiency opportunities in infrastructure, go-to-market strategies, and the overall fixed cost base.

Nicholas Jones asked about Opendoor's view on exclusive listings and how they fit into its strategy, and also questioned the trade-off between aggressive cost-cutting by focusing on fewer markets versus maintaining a larger infrastructure to await a market recovery.

Answer

CEO Carrie Wheeler positioned Opendoor as a consumer-first company that supports innovation and choice, citing their Marketplace product as an example of an exclusive listing option that serves customers who want to avoid the full MLS. CFO Selim Freiha stated that while the company discusses the trade-off internally, it is comfortable with its current geographic footprint and has no plans to retrench from markets, as long as they meet contribution margin targets.

Representing Pat Walravens, Nicholas Jones asked CFO David Rudow, who has been with Jamf for over six months, to reflect on what has been more challenging and what has been easier than he initially expected.

Answer

CFO David Rudow identified the new ERP system implementation as the most challenging aspect, given the company's scale, but noted it is already yielding benefits like multi-currency billing and better visibility. On the easier side, he cited the strength of Jamf's product and its blue-chip customer base as a pleasant surprise, highlighting the significant untapped opportunity for international growth.

Nicholas Jones, on for Pat Walravens, asked if the typical five-year end-of-life for Apple devices is consistent with what Jamf is observing among its customers and how that trend may have changed recently.

Answer

CEO John Strosahl confirmed the device lifecycle is generally consistent, typically around four to five years, but noted it has elongated slightly due to recent budget constraints. He highlighted that the large cohort of devices purchased in 2020 for remote work is approaching a refresh cycle, which he views as a significant opportunity for Jamf, especially with the prevalence of employee choice programs that favor Apple devices.

Nicholas Jones from JMP Securities inquired about Offerpad's strategic home acquisition pace for the remainder of 2025, questioning if it would follow typical seasonal patterns or a different ramp-up schedule.

Answer

CFO Peter Knag explained that while seasonality is a factor, the company is also ramping up from intentionally lower Q3/Q4 volumes and aims for 1,000 homes per quarter as a 'North Star' for reaching EBITDA profitability. CEO Brian Bair added that they are still buying selectively, focusing on pockets with good transaction volume and avoiding areas with low buyer demand.

Nicholas Jones from JMP Securities asked about eBay's appetite for M&A in the fashion category, using the successful acquisition of TCGplayer for collectibles as a reference point.

Answer

CEO Jamie Iannone reiterated the company's disciplined 'build, buy, partner' framework. He explained this strategy is applied across all focus categories, providing examples like the partnership with PSA for collectibles and the acquisition of Sertologo for digital authentication in fashion. He emphasized that they continue to look for opportunities to accelerate capabilities through this balanced approach.

Nicholas Jones asked a broader, philosophical question about eBay's positioning in an e-commerce world where wallet share is consolidating to giants like Amazon and Walmart, while Shopify enables a long tail of specialized brands.

Answer

CEO Jamie Iannone reiterated that eBay's strategy is to win with 'non-new, in-season' inventory, where it can be the best place to buy and sell. He pointed out that focus categories are growing at e-commerce rates, and the company likely gained share in them in 2024. He emphasized that by improving the core experience and leaning into its differentiated inventory, especially in a macro environment where discretionary spending is key, eBay can build on its momentum and carve out its unique position.

Nicholas Jones asked about 1stdibs' marketing strategy and key acquisition channels amid a weak luxury housing market, and also inquired about the company's specific efforts related to Agentic AI and machine learning.

Answer

CEO David Rosenblatt explained that the marketing strategy is focused on customer acquisition, highlighting recent success on Facebook and ongoing improvements in Google. On AI, he noted the company built a dedicated team in late 2023 and is prioritizing machine learning for pricing optimization in furniture and jewelry, with plans to expand its use for shipping quotes, personalization, and customer service.

Nicholas Jones asked for a timeline on when Average Order Value (AOV) headwinds might stabilize and for updated thoughts on the luxury housing market's recovery, given its correlation to 1stdibs's business.

Answer

CFO Tom Etergino explained that Q3 AOV was impacted by lapping a record quarter for high-value orders and a simultaneous dip in those same orders this quarter. He noted that trends began normalizing in October. CEO David Rosenblatt added that the company focuses on outperforming the market and taking share through operational improvements, rather than forecasting a macroeconomic recovery, pointing to Q3's order and revenue growth as evidence.

Nicholas Jones inquired about the company's marketing strategy for the year, particularly its approach to different channels like social media and mid-funnel opportunities. He also asked for color on the pace of opening a Target shop-in-shop compared to a traditional standalone store.

Answer

Co-CEO David Gilboa detailed a broad marketing strategy across a variety of channels, including linear TV, direct mail, and digital advertising. He emphasized the focus on building awareness for the company's full capabilities, such as eye exams and contact lenses, and using localized campaigns to drive traffic to both online and retail channels. Co-CEO Neil Blumenthal expressed confidence in their ability to roll out the Target shops quickly in partnership with the Target team but did not provide a direct timeline comparison to standalone stores.

Nicholas Jones of Citizens JMP asked about the factors influencing the plan to open approximately 40 stores per year and what might cause that pace to accelerate or decelerate. He also inquired about what the company can do to accelerate awareness among its in-network insurance members.

Answer

Co-Founder and Co-CEO Neil Blumenthal confirmed the plan to open at least 40 stores annually, citing consistently strong store performance that meets or exceeds targets. To raise insurance awareness, he mentioned that the company trains its retail teams and partners with insurance carriers on marketing initiatives, including hosting events for brokers in stores and being featured in partner marketing materials.

Nicholas Jones inquired about the company's sales and marketing strategy, specifically regarding channel mix, and asked about the potential role of agentic AI in the auto industry and CarGurus' position to capitalize on it.

Answer

Jason Trevisan, CEO, explained that the marketing strategy is intentionally shifting towards brand-building channels like TV and online video to drive more memorable and direct traffic. Regarding AI, he described it as a 'huge opportunity,' highlighting a pilot for a virtual assistant that engages upper-funnel shoppers to help them find the right vehicle, thereby capturing users earlier and providing richer, more qualified leads to dealers.

Nicholas Jones asked about the long-term drivers for dealer spend growth, including pricing power, and questioned the robustness of the product pipeline for increasing attach rates.

Answer

CFO Elisa Palazzo stated that growth is driven by durable factors like higher dealer engagement, adoption of value-added products, and stronger retention leading to longer contracts. CEO Jason Trevisan elaborated on the product pipeline, which includes both upsells through feature-rich tiers and cross-sells into new areas of the dealer workflow like vehicle sourcing and pricing.

Nicholas Jones asked about ACV's current thinking on using pricing as a lever for growth and inquired about the stickiness and churn of dealers on the marketplace platform.

Answer

CEO George Chamoun confirmed that ACV's fees are still slightly lower than competitors, providing some room for price increases this year, though he remained guarded on specifics. CFO Bill Zerella noted that marketplace ARPU grew 9% last year from price increases and a lower increase is modeled for this year. Regarding dealer stickiness, Chamoun pointed to ACV's significant and growing market share in its oldest markets as evidence of strong retention and wallet share growth with early customers.

Nicholas Jones asked about ACV's broader pricing philosophy, whether the current ~$500 ARPU is a stable target, and the company's outlook on market normalization amid interest rate uncertainty and post-election dynamics.

Answer

CEO George Chamoun stated that while ACV has successfully increased its pricing to be more competitive, the company advises analysts to continue modeling around the $500 ARPU target for the midterm. He projected that the dealer wholesale market would likely remain flattish next year due to persistent used vehicle shortages, with a true market tailwind not expected until potentially 2026.

Nicholas Jones asked about the future trajectory of Angi's key operating metrics like monetized transactions, and questioned if learnings from past valuation cycles are influencing IAC's current M&A strategy.

Answer

Angi CEO Jeff Kip explained that he expects monetized transactions to grow again in 2026, following a period of optimizing the pro network by focusing on retention over low-profitability acquisition. IAC CEO Joey Levin addressed M&A, stating that having a strategic 'edge' is critical in any valuation environment. He cited the Meredith acquisition, where IAC's operational ability to modernize the digital business was key to its success despite macro headwinds.

Nicholas Jones inquired about the potential to accelerate the product roadmap and investments given strong performance, what management finds exciting about the 'Right Now' feature rollout, and progress on new advertising formats and indirect revenue monetization.

Answer

CEO George Arison stated that while the team has an aggressive stretch plan, the focus remains on building user engagement before monetization, citing the 'Interest' tab as a successful off-roadmap launch. He noted 'Right Now' is seeing strong reengagement from its target user segment. CFO Vanna Krantz and CEO George Arison added that indirect revenue growth is driven by new ad partners, enhanced ad formats like native and rewarded video, and simple but effective optimizations like reordering ad placements.

Nicholas Jones asked for insights into the market demand for Zillow Showcase as it rolls out, including learnings about its current pricing strategy and the potential for future adjustments.

Answer

CEO Jeremy Wacksman responded that while it's still early, the product's variable pricing has been well-received. The main challenge is operational: helping agent teams integrate the new media capture and sales process into their workflows. He expressed confidence in the intermediate-term goal of a $150-$300 million annual business from Showcase, emphasizing its strong long-term adoption potential.

Nicholas Jones asked for more detail on Zillow Showcase, specifically about the market demand being observed and what the company is learning about its pricing strategy and long-term potential.

Answer

CEO Jeremy Wacksman noted that while it's still early, the variable pricing for Showcase is landing well with agents. The primary challenge is helping agent teams of various sizes operationalize the new media workflow. He expressed confidence in the 5-10% active listing share target, representing a $150M-$300M annual business, and sees potential beyond that as Showcase sets a new standard for digital listings.

Nicholas Jones from Citizens JMP inquired about the key drivers behind the impressive 44% growth in the multifamily rentals business and the strategic benefits of app users versus web traffic.

Answer

CEO Jeremy Wacksman attributed the rentals success to building a two-sided marketplace with the most comprehensive inventory, which attracts the largest audience and drives property count growth. He emphasized that high app engagement, with users on the Zillow app 3x more than competitors, is a crucial indicator of brand loyalty and a key factor in converting audience into transactions toward the company's 6% market share goal.

Nicholas Jones inquired about the key inputs driving expectations for higher revenue growth in 2025 compared to 2024, and asked for an update on the supplier services segment, particularly when it might return to growth.

Answer

CFO James Miln stated that 2025 growth will be driven by the same key initiatives as 2024: expanding the buyer/supplier network, growing the marketplace menu, and progress in enterprise and international markets, which will help grow both buyers and revenue per buyer. CEO Randy Altschuler added that investments in these areas, including modernizing the Thomas platform, are expected to pay increasing dividends. Regarding supplier services, Miln noted they are working to stabilize the segment and aim for quarter-over-quarter growth as 2025 progresses.

Nicholas Jones inquired if the business is prepared for a potential rapid normalization in the auto market and asked about the 'coiled spring' potential for growth.

Answer

CEO Ernie Garcia embraced the 'coiled spring' analogy, stating that the company is more efficient than ever, making growth easier. He highlighted the performance spread versus competitors, visibility into further financial gains, and latent capacity to support up to 3 million units annually, positioning Carvana to capitalize on the market opportunity.

Nicholas Jones of JMP Securities LLC inquired about the leverage in product development, the process for prioritizing investments to accelerate GMS growth, and the potential for a future investment cycle.

Answer

CEO Josh Silverman explained Etsy's squad-based approach to product development, noting the focus on foundational experiences like the 'Q score' for search. He mentioned cautious incremental hiring for app engineers and machine learning. CFO Rachel Glaser added that the company optimizes costs through global development centers.

Nicholas Jones asked about the potential for further growth in Dotdash Meredith's programmatic ad rates, which were up 36% in the quarter. He also questioned the adoption and impact of the D/Cipher guarantee product, referencing a recent case study with Pandora.

Answer

IAC Executive Christopher Halpin expressed confidence in DDM's ability to continue outperforming the market on programmatic rates, driven by its superior technology and high-intent inventory. He noted that the D/Cipher product is already used in over half of DDM's premium deals and that the company has over 27 case studies demonstrating its superior performance compared to traditional cookies.

Questioned the 2024 guidance, asking if it implies flat or declining gross revenue and potential take rate compression. Also asked for clarity on the outlook for gross revenue per transaction and the mix between transaction growth and revenue per transaction.

Answer

Management clarified they are not projecting a decline in gross revenue but are being conservative. They expect take rates to grow in the medium term but may see short-term fluctuations due to mix changes, such as an increase in short-haul flights in Asia. They also noted the 2023 gross bookings figures should be adjusted for the LBF business divestiture for a proper year-over-year comparison. Gross revenue per transaction is influenced by general airfare trends and the growth in lower-dollar, short-haul flight bookings.

Asked about the financial impact of the recent workforce reduction, the strategy for rolling out new products across all markets, and the recovery outlook for Vietnam and Malaysia.

Answer

The workforce reduction will result in significant but not directly linear cost savings, as investments in critical roles will continue. New products are being rolled out proactively based on market readiness, not just waiting for economic recovery. The company is conservatively optimistic about a second-half recovery in Vietnam, driven by urbanization and infrastructure, and sees positive signs in Malaysia, including a potential shift to renting.